Though São Paulo took home the grand prize in this year’s Bloomberg Mayors Challenge, both Bogotá and Medellín were among the five winners, making Colombia the only country with two selections. The $1 million USD prize will help the capital improve the daily commute for school children while Medellín’s winnings will go toward creating alternatives to the predatory loan shark lending that is commonplace in the city.

“If these ambitious ideas take root, they have the potential to improve lives across the region and serve as a model for other cities around the world,” said Michael Bloomberg, founder of U.S.-based nonprofit Bloomberg Philanthropies.

The competition started earlier this year with mayors throughout Latin America submitting their best ideas for reforming their municipalities. In July, 20 finalists refined their proposals during during a two-day “Bloomberg Philanthropies’ Ideas Camp” in Bogotá before submitting a final application in September.

When the judges made their decisions last month, the capital found itself among the winners for Mayor Enrique Peñalosa’s plan for “Creating a Safer, Shorter and More Engaging School Commute for Bogotá’s Youth.” Medellín and Mayor Federico Gutierrez were honored for an initiative for “Enabling Neighborhood Loan Funds, Reducing Illegal Lending.” In addition to the $1 million USD prize, both will receive “robust implementation support to bring their proposals to life,” according to Bloomberg Philanthropies.

São Paulo, the grand prize winner, will receive $5 million USD. Guadalajara, Mexico, and Santiago, Chile, were the other two winning cities and will get the same financial and technical support as Bogotá and Medellín.

The Bloomberg Mayors Challenge is now in its third iteration and has rotated across different regions, settling in Latin America this year after starting in Europe and then moving to the United States. The European winners were Barcelona (grand prize), Athens, Kirklees, Stockholm, Warsaw. Providence (grand prize), Philadelphia, Houston, Santa Monica, and Chicago took top honors in the United States.

The following plan details, republished in full courtesy of Bloomberg, lay out the specifics of both Bogotá and Medellín’s award-winning ideas to improve Colombia’s two biggest cities.

Bogotá has been improving its security for years — but still has a long way to go. (Photo Credit: Jared Wade)

Creating a Safer, Shorter and More Engaging School Commute for Bogotá’s Youth

The Problem

In Bogotá, 1.5 million children face arduous, hours-long commutes to and from school, usually in vehicles ill-suited for kids. The time spent on the bus does nothing to enrich their education, and does not make the city seem like a welcoming place for children. Even for those who commute via bicycle or on foot, the perception of aggression in the streets and the long distances to and from school prevent the journey from being a positive experience.

The Idea

The city will create a twice-daily “Children’s Hour,” which will use transportation solutions like school-bus only lanes, new pedestrian zones and bicycle-sharing to shorten the commute and to improve the experience while commuting. City leaders will also challenge the community to use this time each day to celebrate children and share Bogotá’s story with them. To encourage community involvement, the city will use technological tools to “gamify” participation by providing incentives and rewards for citizen engagement. This approach turns the problem into part of the solution by using existing city resources and spaces to turn long commutes into positive journeys.

The Inspiration

This holistic approach to children’s commuting experiences came from a desire to not only make the commuting process itself better, but also to highlight the role of children in society and encourage citizens to invest in their well-being. When city residents are directly responsible for improving the children’s commute, children gain the autonomy that comes with improved mobility and benefit from the security that a stronger community network provides. Citizens, in turn, are more likely to feel connected to, and invested in, their daily lives in the city.

Words from Bogotá

“In addition to the benefits in mobility, the Children’s Hour will have positive impacts in terms of cohabitation and relationships between different groups of citizens. The contests and activities dedicated to children will generate a culture that gives priority to the care and attention to the most vulnerable. The effects of this cultural change will be tangible not only for children, but for all citizens in general.”

Medellín, the second largest city in Colombia, continues to be recognized for its transformation. (Photo Credit: Jared Wade)

Medellín: Enabling Neighborhood Loan Funds, Reducing Illegal Lending

The Problem

Almost 400,000 people living in poverty cannot enter the formal banking system, instead accessing illegal loans that support organized crime in Medellín. These illegal loans, called “pagadiarios,” affect more than 36% of the population and are used by people to support their employment, cover life-threatening emergencies, and meet their daily needs. Organized criminals subject their clients to a stubborn circle of poverty, charging interest rates of up to 700% annually. This corrupt system uses violence and intimidation as a collection tactic, targeting those who are the most vulnerable and marginalized from the financial system. Violent crime is one of the most critical issues facing cities across the region, and Medellín is demonstrating that mayors can take the lead in safeguarding the security of their citizens.

The Idea

The city will tackle these challenges through Bancuadra, “the world’s smallest bank.” Bancuadra is a network of neighbors who pool their financial resources. It provides access to credit, loans for work materials, and a jobs bank, with no complex procedures or requirements to join. Neighbors can make withdrawals at authorized central locations in their own neighborhood, like local businesses. These services operate on a digital platform accessible through multiple devices, and users are sent by text messages to ensure the traceability of transactions.

The Inspiration

Bancuadra is inspired by the collaborative economy and shared value principles. It intends to solve a complex social problem with an economically sustainable business model, which is mediated by technology and will enhance collaboration at a local scale.

Words from Medellín

“Our idea is a great opportunity to create a municipal venture aimed at offering easy, quick, and safe credit access to more than 36% of the population of Medellín.”

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About the Author

Jared Wade is editor in chief of Finance Colombia. He is a Bogotá-based journalist with 15 years of experience covering topics including business, financial services, Latin America, and sports. Email him at jared.wade(at) financecolombia.com or follow him on Twitter at @Jared_Wade.